Judge won't hear Global Aviation case, says New York has jurisdiction

By Jim Witters

Wilmington, Del., Nov. 13 - A Delaware bankruptcy judge halted first-day proceeds in the new Global Aviation Holdings, Inc. case, saying that the debtors' previous case remains open in the U.S. Bankruptcy Court for the Eastern District of New York and that court retains jurisdiction.

Before the debtors' attorneys began presenting their motions in the U.S. Bankruptcy Court for the District of Delaware, judge Mary F. Walrath asked whether they had obtained an order under bankruptcy Rule 1014, which governs the dismissal and transfer of cases.

Global Aviation Holdings' plan of reorganization was confirmed in the New York court on Dec. 6 and became effective on Feb. 13.

But the New York case remains open and under the jurisdiction of judge Carla E. Craig as the debtors pay claims and attempt to resolve a few outstanding issues.

Kenric D. Kattner, representing Global Aviation, argued that his client is the reorganized debtor and is no longer subject to the New York bankruptcy proceeding.

Judge Walrath disagreed.

"It is still the debtors' case, even though the plan was confirmed," she said.

With that case open and with no ruling from the New York bankruptcy judge granting a change of venue, the Delaware case cannot proceed, Walrath told Kattner.

Walrath declared a recess to allow the attorneys to contact judge Craig to try to resolve the matter.

Kattner returned after the recess to report that he was trying to arrange an emergency hearing in the New York bankruptcy court late Nov. 13 or early Nov. 14 to obtain the necessary authority for the Delaware case to proceed.

Judge Walrath rescheduled the first-day hearing for 12:30 p.m. ET on Nov. 14.

But she cautioned that judge Craig may determine that the new case must be heard in her court.

Global Aviation, a Peachtree City, Ga.-based provider of charter air transportation for the U.S. military and of commercial global passenger and cargo air transportation services, filed for bankruptcy in Delaware on Nov. 12. The Chapter 11 case number is 13-12945.

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